The balance left in the share forfeited account after the reissue of such shares represents which type of profit of the company?

Capital profit

The correct answer is option 2- Capital profit.

The balance left in the share forfeited account after the reissue of such shares represents Capital profit.

The balance, if any, left in Share Forfeited A/c, in respect of shares reissued, should be treated as capital profit and transferred to Capital Reserve A/c. Once all the forfeited shares have been reissued, any credit balance on Share forfeiture account is transferred to Capital Reserve representing profit on forfeiture of shares. In the event of all forfeited share not being reissued, the credit amount on Share forfeiture account relating to shares yet to be reissued is carried forward and the remaining balance on the account only is credited to capital reserve account.